CLS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 123 industry peers in the Electronic Equipment, Instruments & Components industry. CLS scores excellent points on both the profitability and health parts. This is a solid base for a good stock. CLS is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings could make CLS a good candidate for growth and quality investing.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year CLS was profitable.
CLS had a positive operating cash flow in the past year.
In the past 5 years CLS has always been profitable.
In the past 5 years CLS always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of CLS (10.85%) is better than 91.87% of its industry peers.
CLS's Return On Equity of 35.33% is amongst the best of the industry. CLS outperforms 95.94% of its industry peers.
With an excellent Return On Invested Capital value of 21.33%, CLS belongs to the best of the industry, outperforming 96.75% of the companies in the same industry.
CLS had an Average Return On Invested Capital over the past 3 years of 11.43%. This is above the industry average of 8.87%.
The last Return On Invested Capital (21.33%) for CLS is above the 3 year average (11.43%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	10.85%
ROE	35.33%
ROIC	21.33%

ROA(3y)4.63%

ROA(5y)3.55%

ROE(3y)15.02%

ROE(5y)11.3%

ROIC(3y)11.43%

ROIC(5y)8.93%

1.3 Margins

CLS has a better Profit Margin (6.35%) than 72.36% of its industry peers.
In the last couple of years the Profit Margin of CLS has grown nicely.
Looking at the Operating Margin, with a value of 7.33%, CLS is in the better half of the industry, outperforming 71.54% of the companies in the same industry.
CLS's Operating Margin has improved in the last couple of years.
The Gross Margin of CLS (12.04%) is worse than 76.42% of its industry peers.
In the last couple of years the Gross Margin of CLS has grown nicely.

		Industry Rank	Sector Rank
OM	7.33%
PM (TTM)	6.35%
GM	12.04%

OM growth 3Y24.27%

OM growth 5Y29.03%

PM growth 3Y34%

PM growth 5Y30.13%

GM growth 3Y8.03%

GM growth 5Y10.39%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CLS is still creating some value.
CLS has less shares outstanding than it did 1 year ago.
CLS has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, CLS has a worse debt to assets ratio.

2.2 Solvency

An Altman-Z score of 7.02 indicates that CLS is not in any danger for bankruptcy at the moment.
CLS's Altman-Z score of 7.02 is amongst the best of the industry. CLS outperforms 80.49% of its industry peers.
The Debt to FCF ratio of CLS is 1.97, which is an excellent value as it means it would take CLS, only 1.97 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of CLS (1.97) is better than 78.05% of its industry peers.
CLS has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.37, CLS is not doing good in the industry: 60.16% of the companies in the same industry are doing better.
Although CLS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	0.37
Debt/FCF	1.97
Altman-Z	7.02

ROIC/WACC1.44

WACC14.8%

2.3 Liquidity

CLS has a Current Ratio of 1.47. This is a normal value and indicates that CLS is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.47, CLS is not doing good in the industry: 75.61% of the companies in the same industry are doing better.
CLS has a Quick Ratio of 1.47. This is a bad value and indicates that CLS is not financially healthy enough and could expect problems in meeting its short term obligations.
CLS has a worse Quick ratio (0.88) than 85.37% of its industry peers.
CLS does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	1.47
Quick Ratio	0.88

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 47.90% over the past year.
The Earnings Per Share has been growing by 48.11% on average over the past years. This is a very strong growth
CLS shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.09%.
Measured over the past years, CLS shows a quite strong growth in Revenue. The Revenue has been growing by 10.38% on average per year.

EPS 1Y (TTM)47.9%

EPS 3Y44.1%

EPS 5Y48.11%

EPS Q2Q%51.92%

Revenue 1Y (TTM)22.09%

Revenue growth 3Y19.63%

Revenue growth 5Y10.38%

Sales Q2Q%27.79%

3.2 Future

The Earnings Per Share is expected to grow by 38.14% on average over the next years. This is a very strong growth
CLS is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 27.74% yearly.

EPS Next Y53.05%

EPS Next 2Y46.37%

EPS Next 3Y43.28%

EPS Next 5Y38.14%

Revenue Next Year26.52%

Revenue Next 2Y29.69%

Revenue Next 3Y30.76%

Revenue Next 5Y27.74%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 57.40, the valuation of CLS can be described as expensive.
The rest of the industry has a similar Price/Earnings ratio as CLS.
CLS's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.21.
A Price/Forward Earnings ratio of 36.09 indicates a quite expensive valuation of CLS.
CLS's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.98, CLS is valued a bit more expensive.

		Industry Rank	Sector Rank
PE	57.4
Fwd PE	36.09

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as CLS.
The rest of the industry has a similar Price/Free Cash Flow ratio as CLS.

		Industry Rank	Sector Rank
P/FCF	87.56
EV/EBITDA	35.72

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CLS may justify a higher PE ratio.
CLS's earnings are expected to grow with 43.27% in the coming years. This may justify a more expensive valuation.